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State Farm v. Shelly

Supreme Court of Michigan
Jul 23, 1975
394 Mich. 448 (Mich. 1975)

Summary

holding that where an exclusionary clause is void as against statutory policy, reinstated coverage is limited to the amount required so that the vehicle is not an uninsured motor vehicle within the meaning of the statute

Summary of this case from United Servs. Auto. Assoc. v. Markosky

Opinion

Docket No. 56846.

Decided July 23, 1975.

Draugelis, Ashton Scully for plaintiff.


MEMORANDUM OPINION. On order of the Court, plaintiff-appellant's application for leave to appeal is considered and the same is hereby granted.

The Court, sua sponte, pursuant to GCR 1963, 865.1(7), hereby reverses that portion of the decision of the Court of Appeals relating to the extent of the insurance company's liability where an exclusionary clause in a policy of motor vehicle liability insurance is void because it is against the policy of the Motor Vehicle Accident Claims Act (MVACA).

Under the MVACA, a motor vehicle could be registered as an insured vehicle on the strength of a certificate of insurance certifying that a policy of insurance had been issued covering the vehicle in compliance with the MVACA. Exclusions which purported to limit coverage below that required so that the vehicle would not be an "uninsured motor vehicle" within the meaning of the MVACA were invalid.

The question is whether the insurance company's liability as to the reinstated coverage is limited to the amount required by the statute or extends to the full, and greater, amount set forth in the policy.

We have considered decision in other jurisdictions and the opinion of the Court of Appeals reported at 59 Mich. App. 491 holding that coverage extends to the greater amount.

The MVACA provides that a motor vehicle is uninsured if it does not meet the requirements of the motor vehicle responsibility law, MCLA 257.501, et seq.; MSA 9.2201, et seq., which provides in part that "with respect to a policy which grants such excess or additional coverage the term `motor vehicle liability policy' shall apply only to that part of the coverage which is required by this section". MCLA 257.520(g); MSA 9.2220(g).

We are persuaded that where an exclusionary clause is void as against the policy of the MVACA, reinstated coverage is limited to the amount required so that the vehicle is not an uninsured motor vehicle within the meaning of the MVACA.

T.G. KAVANAGH, C.J., and WILLIAMS, LEVIN, M.S. COLEMAN, J.W. FITZGERALD, and LINDEMER, JJ., concurred.

SWAINSON, J., took no part in the decision of this case.


Summaries of

State Farm v. Shelly

Supreme Court of Michigan
Jul 23, 1975
394 Mich. 448 (Mich. 1975)

holding that where an exclusionary clause is void as against statutory policy, reinstated coverage is limited to the amount required so that the vehicle is not an uninsured motor vehicle within the meaning of the statute

Summary of this case from United Servs. Auto. Assoc. v. Markosky

In Shelly, an automobile liability policy expressly excluded coverage of the insured vehicle when the family's son was driving.

Summary of this case from Powers v. Daiie

In State Farm Mut. Auto. Ins. Co. v. Shelly, 394 Mich. 448, 231 N.W.2d 641 (1975), the Supreme Court of Michigan held an exclusionary clause void as against public policy, but only to the extent of the statutory minimum coverage.

Summary of this case from State Farm Mut. v. Nationwide Mut

In Shelly, Harold Shelly, Jr., the insured's son, was driving his father's car when he was involved in an accident in which several people were killed.

Summary of this case from Ohio Farmers v. Michigan Mutual

In Shelly, our Supreme Court held that an insurer is only liable for the minimum amount of coverage required by law when coverage is reinstated for public policy considerations.

Summary of this case from Ohio Farmers v. Michigan Mutual

In Shelly, the Michigan Supreme Court held that where an exclusionary clause in a motor vehicle insurance policy issued under the financial responsibility act, MCL 257.501 et seq.; MSA 9.2201 et seq., is void as against the Motor Vehicle Accident Claims Act, MCL 257.1101 et seq.; MSA 9.2801 et seq., the reinstated coverage is limited to the minimum required by law rather than the greater policy amount.

Summary of this case from Nichols v. Kwek
Case details for

State Farm v. Shelly

Case Details

Full title:STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY v SHELLY

Court:Supreme Court of Michigan

Date published: Jul 23, 1975

Citations

394 Mich. 448 (Mich. 1975)
231 N.W.2d 641

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